Friday, April 15, 2011

Industrial Scale Ethanol

After my recent posting on resurgent food vs. fuel competition from expanding corn ethanol production, one of my contacts called to ask if I was familiar with an industrial process developed by Celanese Corporation for producing ethanol from a variety of feedstocks, including natural gas, coal, and potentially cellulosic biomass. My initial reaction to him was based on my knowledge that such processes have been around for decades, and that until the policy-inspired growth of the corn ethanol industry, much of the ethanol for industrial use was produced in that fashion. However, I was unaware of plans to deploy this technology on a truly massive scale, in the form of a pair of 400,000 ton-per-year coal-to-ethanol plants in China. I consider this a really interesting development on several levels.

The attraction of producing ethanol for industrial or fuel use from indigenous non-food raw materials in China seems obvious. It enhances the country's food and energy security by avoiding imports of both. As I delved into the technology involved, I realized it starts with gasification, a process that my former employer, Texaco Inc., licensed to numerous facilities in China, going back to the 1980s. So China has deep experience with gasification as an effective and reliable way to turn feedstocks as diverse as waste oil, petroleum coke, low-value coal, and even natural gas into syngas, or synthesis gas, a mixture of carbon monoxide and hydrogen from which all sorts of useful organic chemicals can be produced. One of those is acetic acid (the acid in vinegar.) It turns out that Celanese's new ethanol process is an offshoot of the company's well-established "acetyl platform" for making acetic acid in plants like this one in Singapore.

It's noteworthy that the first ethanol plants Celanese is building are so large. 400,000 metric tons per year equates to 134 million gallons per year, larger than all but a couple of the corn-based ethanol plants in the US. I've also seen hints that these facilities could be expanded to 1 million tons/yr, which would put their output in the same league as the gasoline yield of the smallest oil refineries. That would be truly industrial scale fuel production that conventional or advanced biofuels can't yet match and may never do, because of their much more complex supply chain considerations. That also explains why Celanese could consider building a 40,000 ton ethanol plant in Texas based on natural gas. The supply chain isn't an issue when it's just an existing pipeline. In any case, large scale and low feedstock cost should result in ethanol output that's more than competitive with ethanol from biomass. US biofuel producers eyeing export markets ought to be concerned about the potential competition from Celanese, even if the federal Renewable Fuels Standard (RFS) guarantees them a market here.

My other instant reaction when I heard about this process focused on the potential environmental consequences of producing ethanol from coal. However, as I thought about it more carefully, it occurred to me that processing coal into ethanol using the extremely clean gasification process, which allows for sulfur and other contaminants to be easily and safely collected and disposed of, is probably a lot more benign than burning the same coal to produce electricity, particularly in power plants without state-of-the-art pollution equipment. Assessing the greenhouse gas impact of coal-to-ethanol requires a thorough lifecycle analysis that I have not yet found.

At the same time, it's clear that the environmental comparison to biofuels like corn-based ethanol isn't nearly as bad as suggested by an erroneous comment in a Business Week article on the subject last November, which stated that corn ethanol production "doesn't use a fossil fuel as a raw material." In fact, analysis by the Argonne National Laboratory of the US Department of Energy found that 78% of the energy in a typical gallon of corn ethanol comes from fossil fuels, including coal, diesel fuel, and natural gas. That's why the emissions from corn ethanol aren't much lower than from gasoline, after factoring in the natural-gas derived fertilizer used in growing the corn, the diesel fuel required for cultivation, harvesting and transportation, and the coal and natural gas used to generate electricity and process heat for the fermentation and distillations steps. Ethanol from coal might emit incrementally more greenhouse gases than food-crop based ethanol, but not orders of magnitude more. And I'd bet that a gas-to-ethanol plant would match or beat the emissions from a standard corn-based biorefinery, based on avoiding the need to separate the alcohol product from water. Distillation requires lots of energy.

It's getting harder to draw meaningful distinctions between conventional fuels and alternatives when we can make ethanol efficiently from fossil fuels and produce "drop-in" fuels--synthetic gasoline, diesel or jet fuel--from biomass like sugar cane or algae. I haven't seen how the detailed economics and energy balance of the Celanese ethanol process compare to traditional and advanced processes for producing ethanol from biomass, but I think we're going to be hearing a lot more about this option in the future. I was surprised to see that it even garnered a mention in the White House press release for the President's visit to China earlier this year.

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